Freebies in Elections

Context:

• Political parties have announced freebies like Free bus ride, Free Electricity, 5kg – 10kg Rice, subsidised cylinders etc. during recent states assembly elections.

Quote/Statement: 

• Give a man a fish and you feed him for a day, teach a man to fish and you feed him for a lifetime.    Proverb

• "Freebies are never free... especially harmful are subsidies that distort prices”. When political parties offer such schemes, they must be required to make the financing and trade-offs clear to voters. – RBI Monetary Committee

Ethical Issues associated with Freebies

• Dependency Syndrome: Freebies can create a negative pattern of dependency and entitlement among the recipients, who may expect more freebies in the future and become less motivated to work hard or pay taxes. 
• For example: freebies such as rice 5 at Rs 1 per kg or electricity at zero cost can reduce the sense of responsibility and accountability of the beneficiaries and make them dependent on external aid
• Chances to fail Obligations: Freebies can have adverse consequences on the fiscal health and macroeconomic stability of the state or the country, by increasing public expenditure, subsidies, deficits, debts, and inflation. 
• For example: loan waivers, unemployment allowances, or pension schemes can strain the budgetary resources and fiscal discipline of the government and affect its ability to invest in other sectors or repay its obligations.
• Induce Corruption: Policy of freebies also leads to lack of probity in governance, as a result, corrupt practices increase significantly.
• For example: freebies such as bicycles or laptops may be of inferior quality or outdated technology compared to those available in the market or those produced by other countries
• Compromise Quality: Freebies can lower the quality and competitiveness of the goods and services that are given for free, by reducing the incentives for innovation and improvement.
• Distort expenditure Priorities: Freebies can distort the expenditure priorities and allocation of resources, by diverting funds from more productive and essential sectors such as infrastructure, agriculture, industry, etc. 
• For example, freebies such as mobile phones, laptops, or air conditioners can consume a large 6 share of public spending and crowd out investment in public goods such as roads, bridges, irrigation systems, or power plants.
• Degrade Environment: Freebies can have a negative impact on the environment, by encouraging overuse and wastage of natural resources, such as water, electricity, or fuel. 
• For example
• Freebies such as free power, free water, or free gas cylinders can reduce the incentives for conservation and efficiency and increase the carbon footprint and pollution levels. 
• A report by the CAG revealed that free electricity for farmers in Punjab led to overuse 7 and wastage of power, low tax compliance, and poor quality of service delivery by the state power utility.

Way Forward:

• Transparency regarding available funds:?Political parties should be required to disclose the financing and trade-offs of freebies to the voters and the ECI before announcing them. 
• Example: Due to freebies and subsidy, employees of a state are not getting salary on time.
• Upheld Integrity: The government should specify the sources of revenue, the impact on fiscal balance, the opportunity cost of public spending, and the sustainability of freebies.
• Change in Attitude of Voters:?Educating voters about the economic and social consequences of freebies and encouraging them to demand performance and accountability from political parties. This would include creating awareness among them about the cost benefit analysis of freebies.
• Inclusive Development:?It would address the root causes of poverty, inequality, and exclusion that make people vulnerable to freebies. Inclusive development would also create a more conducive environment for economic growth and social progress.
• Balanced Welfare and Freebie Policy:?Freebies must be understood from an economic perspective and?connected to taxpayers' money. 
• Differences between subsidy and freebie are also essential?since subsidies are justified and specially targeted benefits meant to meet specific demands. The freebies, on the other hand, are quite different. 
• Institutional Intervention: Institutions like judicial involvement is required in order to propose measures. The Supreme Court has suggested setting up an expert committee to look into the issue of freebies and their impact on the economy and democracy.
• Training: Campaigns, voter literacy programs, civil society initiatives, and media platforms can empower voters to make rational and ethical choices.

Advantages of Freebies

• Increase Trust and faith: Government freebies can increase public trust and satisfaction with the government, as they demonstrate its responsiveness and accountability to the people. 
• Example: PM Kisan Samman Yojana, Old age and Widow Pension Yojana 
• Enhance Accountability: Freebies can create opportunities for feedback and dialogue between the government and the citizens, enhancing transparency and democracy.
• Example: Bus services to be improved for Free Ride Bus service for women.
• Inclusive Growth: Freebies can stimulate economic growth by increasing the productive capacity of the workforce, especially in less developed regions. 
• For example, freebies such as laptops, bicycles, or sewing machines can enhance the skills, mobility, and income opportunities of the poor and rural population. 
• Social Welfare: They can provide basic necessities and social welfare to the poor and marginalized sections of society, such as food, education, health, electricity, etc. 
• For example, freebies such as uniforms, textbooks, or health insurance can improve the literacy, health, and quality of life of the needy and vulnerable groups. 
• Income Equality: Freebies can reduce income inequality and poverty by redistributing wealth and resources more equitably. 
• For example, freebies such as loan waivers, or cash transfers can empower the indebted, or low-income households by giving them access to assets, credit, or income support. 
• Availability of basic Essential items: A study by the Centre for Policy Research found that freebies of essential items such as Rice, laptops, bicycles, and cash transfers had a positive impact on voter turnout, political awareness, and satisfaction with the government

Conclusion

• While addressing the promises made during the election campaigns, it is not advisable to focus only on the political aspect.
• It is also important to keep in mind the Ethical, Social and Economic part because ultimately the feasibility, impact on society, budgetary allocation and resources are limited. Politics, Ethics and economy should go hand in hand when talking about freebies.